Food Inflation to Last

The Chicago Board of Trade said wheat prices in America are now approximately 150 percent above a year ago, soy is up nearly 100 percent from last year, and the high-protein spring wheat traded at the Minneapolis Grain Exchange-which is in short supply-is up a huge 350 percent from a year ago.The scarcity in our wheat supply is a result of farmers, who have stopped growing wheat in favor of corn for the bio-fuel industry, a shortage of wheat in Australia, and increased demands for wheat from India and China.

When the price of wheat rises…what wheat goes into, goes up, too. The price of wheat affects the price of cereal, alcohol, as well as bread.

You might not first think that beef, pork, and chicken would be affected by the price of wheat, but wheat is used in animal feeds. Meat products will eventually increase in cost, as a direct result of the price of wheat going up.

The rising cost of wheat and corn supplies also has an effect on the price of dairy products for the same reason. The price of soybeans has risen 25 percent this year, while wheat has increased 21 percent. Analysts say strong food price inflation is likely to last through 2008. This indicates huge price increases for families at the grocery store.

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